University of Oulu

Leviäkangas, P., Pargar, F., Sirvio, K., Khabbaz Beheshti, B., Love, P. (2019) Service Value and Componentized Accounting of Infrastructure Assets. Journal of Infrastructure Systems, 25 (3), 04019025. doi:

Service value and componentized accounting of infrastructure assets

Saved in:
Author: Leviäkangas, Pekka1; Pargar, Farzad2; Sirviö, Konsta3;
Organizations: 1VTT Technical Research Centre of Finland Ltd., Kaitoväylä 1, P.O. Box 18021, Oulu FIN-90571, Finland
2Industrial Engineering and Management, Faculty of Technology, Univ. of Oulu, P.O. BOX 8000, Oulu FI-90014, Finland
3Sirway Ltd., Töölönkatu 1, P.O. Box 335, Helsinki FIN-00250, Finland
4Dept. of Chemical Engineering, Curtin Univ., GPO Box U1987, Perth, WA 6845, Australia
Format: article
Version: published version
Access: open
Online Access: PDF Full Text (PDF, 1.4 MB)
Persistent link:
Language: English
Published: American Society of Civil Engineers, 2019
Publish Date: 2019-08-14


Asset management is a strategic tool for maintaining the value of an asset at a level that is satisfactory for users, asset owners, and taxpayers. This paper introduces the concept of service value. The concept is applied following the recommendations of the Organisation for Economic Co-operation and Development (OECD): service value equals the value of economic benefits generated by an asset. It is shown how alternative value accounting methods result in different asset values. The present value method, as recommended by accounting practitioners and in line with the concept of service value, is more appropriate for asset management purposes than the perpetual inventory method (PIM), despite the fact that the latter is more widely used. The impact of correct asset and service value accounting extends well beyond project and investment program management levels to the national accounting system of fixed capital. Incorrect asset management accounting may lead to serious under- or overestimation of investments and repair debt.

see all

Series: Journal of infrastructure systems
ISSN: 1076-0342
ISSN-E: 1943-555X
ISSN-L: 1076-0342
Volume: 25
Issue: 3
Article number: 04019025-1-12
DOI: 10.1061/(ASCE)IS.1943-555X.0000497
Type of Publication: A1 Journal article – refereed
Field of Science: 222 Other engineering and technologies
Funding: The Finnish Transport Agency is acknowledged for providing support for the initial stage of this study in 2017.
Copyright information: © ASCE. This work is made available under the terms of the Creative Commons Attribution 4.0 International license,